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The ‘Soft’ Issues in Public Sector Procurement

We are delighted to publish this article from Sigi Osagie, leading expert on effectiveness in Procurement and Supply Chain Management. Sigi is author of the highly-acclaimed book “Procurement Mojo – Strengthening the Function and Raising Its Profile

The recession forced many organisations to seek ways to optimise their costs. For most organisations, purchasing spend is the largest or second-largest area of expenditure. Hence, Procurement departments have faced a greater expectation to deliver more financial value.

Public sector organisations are not immune to these challenges. Government budgets have been squeezed, and public sector bodies are being forced to find ways to secure more value from every pound they spend in delivering services to their end users. The ongoing problems with delivering health and social services at acceptable standards are widely publicised right now – acute symptoms of the massive financial difficulties in the public sector.

Cost containment isn’t the only reason for the increased focus on purchasing. Averting fraud and corporate social responsibility failings are examples of the added socio-economic challenges compelling organisations of all sorts to improve their Procurement capability.

Undoubtedly, Procurement is under the spotlight like never before. And nowhere is this more acutely felt than in the public sector.

Procurement practitioners in the public sector face similar underlying issues as their peers elsewhere. As in the charity and private sectors, many public Procurement functions are still struggling to achieve the success and recognition they crave.

Purchasing professionals in such functions are frustrated by the problems this brings – from regular squabbles with budget-holders who don’t appreciate Procurement’s role to disagreements with Finance colleagues who think “Procurement cost savings” is all smoke-and-mirrors.